Gerry Brownlee National Local Government Spokesperson

27 September 2002

Big rates rises under new legislation

Residential and commercial property owners across the country face large rate rises under new legislation that will load extra costs onto local authorities, says National Local Government Spokesperson, Gerry Brownlee.

"The Local Government Amendment Bill, due back in the House next month, will dramatically increase compliance costs for local authorities as they will be required to produce annual plans, three-year plans, ten year plans and possibly twenty-five year plans in return for the power of general competence.

"The problem with the Bill is the huge costs of all the consultation required to prepare these plans. There are also escalating costs for councils in a requirement to have more input from local Iwi and other Maori groups.

"The Bill also gives councils new powers of general competence which means they can embark unchecked on projects that waste money and fail. Examples of this include the Hutt City Plaza, which cost ratepayers $50 million and was sold for $7 million, or New Plymouth's $300,000 "wind wand" which blew away, or fibre glass rabbits in Cathedral Square.

"Local authority rates have risen by over 44.9% over the last decade - compared to a rise of 22.1% in the CPI over the same period. Rates are already rising at a high rate without out this Bill making life even tougher for people on fixed incomes.

"I doubt any of the larger metropolitan local Authorities would be prepared to say rates won't increase after this Bill is passed. This Bill needs some serious debate for it proceeds any further locking councils and ratepayers into high costs," Mr Brownlee said.

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